"Deficits and debt are not just a spending problem. Revenues as a share of GDP over the past few years are the lowest they have been since World War II. We simply don't raise enough revenue," he said in a speech at the Bipartisan Policy Center in Washington, D.C.

While he offered no specific details or timetable for his proposal, Baucus noted that policymakers will need to rethink the hundreds of tax breaks on the books.

"Tax breaks have doubled since 1986," he said. "They now cost as much in revenue as the entire income tax brings in."

In 2011, the government collected $2.3 trillion in revenue -- of which $1.1 trillion comes from the individual income tax and $181 billion from corporations.

Baucus, who chairs the Senate Finance Committee, likened the current tax code to Hydra, the mythical beast with many heads who grows back two every time one is chopped off.

Case in point: In 1986, the last time Congress overhauled the tax code, there were 14 "temporary" tax breaks on the books. Today there are 132, many of which have been automatically extended time and again.

And complexity has grown throughout the tax code. Baucus noted that since 1986, there have been 15,000 changes made to the tax code.

No one realistically expects Congress to adequately address tax reform before the end of the year.

One big reason: Lawmakers have to address the so-called fiscal cliff -- a set of tax hikes and spending cuts that would take more than $500 billion out of the economy in 2013 alone -- enough to cause a recession, economists say.

Another reason why: There's really no broad agreement on the starting point for tax reform, like how much revenue the tax system should raise, said Howard Gleckman, editor of the blog TaxVox.

Unlike Democrats, many Republicans do not want tax reform to raise any more revenue than the current system.

And both parties will have a hard time beating back lobbyists whose job it is to ensure that the industries they represent get a good tax deal.